The Sacramento sausage grinder spat out a bill meant to protect taxpayers from another Anaheim Stadium/backroom-deal fiasco in such a mangled mess that its own author demanded its death.
“I am really angry,” said Sen. Tom Umberg, D-Santa Ana, between shouting “Ayes!” Monday as the Legislative session entered its last few days.
“I spent a ridiculous amount of time on this bill, trying to address the concerns of the schools and cities and special districts that said it would be too cumbersome. We exempted most of the state. Narrowed it to just Orange County. Then it was amended to just apply to Anaheim and stripped of enforcement.
“It’s a mockery. I don’t want to people get the sense that they’re doing something to fix the problem — because it doesn’t.”
Problem
Anaheim is far from the only government to flirt with sweetheart land deals — that is, letting public property pass into private hands for what some consider crazy low prices — but its recent scandal perfectly illustrates the problems with current laws meant to discourage such ugliness.
To recap: The Anaheim city council approved a sale of the Angel Stadium property to owner Arte Moreno’s business partnership in 2019 at a speed that gave many whiplash, and for a price that critics called absurdly low, and often beyond the public gaze.
State officials concluded that the deal violated affordable housing laws because it should have been offered first to developers who build homes for low-income families. The city disagreed and was ready to swallow a fine of as much as $96 million to proceed with the sale anyway — until the FBI swooped in, that is, investigating then-Mayor Harry Sidhu’s desire that, in exchange for pushing the stadium deal through, the Angels would kick in $1 million for his re-election.
Sidhu has denied wrongdoing and has not been charged; the Angels have said they were unaware of any plans for a quid-pro-quo; and the entire stadium deal ultimately collapsed. Umberg thinks the whole episode illustrates the toothlessness of state land laws, specifically, the recently “strengthened” Surplus Lands Act.
Despite that looming $96 million state fine, “the city of Anaheim continued to push the deal through,” Umberg said in the bill’s author statement. The city planned to simply transfer the $96 million from the affordable housing fund already included in the stadium deal. No biggie. No pain. No real disincentive.
To avoid that in the future, we must create stronger disincentives to deter local authorities and private entities from circumventing the Surplus Land Act, he said.
Solution
Under Umberg’s Senate Bill 361, the marketplace would be the ultimate enforcer.
If the state found that an agency violated land laws, it could force that agency to halt the sale, put the property up on the auction block, and take bids. Bids!
“The real purpose of the bill was to require property to be put out to bid so you could see what the market would bear, what it’s really worth, what taxpayers are entitled to — not just what one government agency and a developer agreed to,” Umberg said.
That could go a long way toward illuminating collusion. It was co-authored by Assemblymember Tom Daly, D-Anaheim, and crafted in consult with Assemblymember Phil Ting, whose bills sought to tighten the Surplus Land Act and put more emphasis on affordable housing.
But, alas.
‘Cumbersome’
“We appreciate that the author’s sincere motivation (is) to prevent corruption and abuse of the SLA, but the current approach in SB 361 casts too broad a net, to include even minor and routine transactions,” the League of Cities said in official opposition.
“The bill is explicitly designed to allow HCD (Housing and Community Development) to unilaterally cloud the title to any surplus property, potentially indefinitely, without any appeal process or judicial review.”
Agencies protested that small parcel sales would become a cumbersome nightmare. Umberg tried to address those criticisms by exempting land sales worth less than $25 million — we might point out that $24 million is not chump change — and by slimming down which agencies the law would apply to and where.
Then the Assembly Appropriations Committee narrowed the bill down to a single city — Anaheim — and removed the enforcement mechanism at its heart. As amended, it would do nothing to address the kind of collusion seen in the Anaheim stadium sale. So off it went to the “inactive” file.
“The agencies and governments opposed to SB 361 threw every excuse in the book at the wall to try to find something that would stick in an attempt to stall this effort,” Umberg said in an exceptionally irate statement Monday. “This should speak volumes to the public about why we haven’t seen a major uptick in affordable housing and the ‘roadblocks’ instituted by local governments in this effort.”
He simply sought to ensure that future sales of public property reaped the highest value and provided additional housing. “I’m shocked and disappointed that the State Assembly sided with special interests in Orange County and California to essentially gut SB 361,” Umberg said in the statement.
But he promised to try again if re-elected this fall. Current law simply does too little to protect taxpayers from agencies that collude with buyers to short-change the taxpayers, he said.
Anaheim residents may agree. Here’s hoping the sausage turns out better next time.
Source: Orange County Register
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